Weekly Market Insights
Dec 4, 2023
10 min read
The Markets (as of market close December 1, 2023)
The markets continued to flourish last week. Investors were not deterred by a warning from Federal Reserve Chair Jerome Powell that interest rate hikes may not be over, and it is premature to speculate when rate decreases will begin. The S&P 500 and the Dow reached new 2023 highs, while the Nasdaq posted solid returns as all three indexes extended a run of five straight weekly gains. Despite additional output cuts by OPEC+, crude oil prices continued to lag as demand remained soft. Ten-year Treasury yields closed down nearly 80.0 basis points from a peak in October. Yields fell over 50.0 basis points in November, marking the largest monthly decline since August 2019. The dollar weakened, while gold prices finished the week at a record high.
Stocks edged lower last Monday as investors may have spent more time focused on Cyber Monday deals rather than stock market bargains. Each of the benchmark indexes listed here slipped marginally lower, with the Russell 2000 (-0.3%) falling the furthest, followed by the Global Dow and the S&P 500 (-0.2%), while the Dow (-0.2%) and the Nasdaq (-0.1%) also ticked lower. Long-term bond prices rose, pulling yields on 10-year Treasuries down 8.3 basis points to 4.38%. Crude oil prices dipped 0.7%, settling at around $75.00 per barrel. The dollar declined 0.2%, while gold prices rose 0.6%.
Last Tuesday saw stocks recoup losses from the prior day, while bond yields continued to decline. Among the benchmark indexes listed here, only the Russell 2000 closed in the red, falling 0.5%. The Global Dow advanced 0.4%, the Nasdaq rose 0.3%, the Dow climbed 0.2%, and the S&P 500 inched up 0.1%. Ten-year Treasury yields settled at 4.33% after falling 5.3 basis points. Crude oil prices rose 2.0% to $76.37 per barrel. The dollar fell 0.4%, while gold prices gained 1.5%, advancing for the second straight day.
Stocks closed mostly lower last Wednesday. Among the benchmark indexes listed here, only the Russell 2000 (0.6%) advanced, with the Dow and the Global Dow unchanged. The Nasdaq and the S&P 500 dipped 0.1%. Stocks began the day on an upswing as investor hopes for a strengthening economy got a boost by solid third-quarter gross domestic product data (see below). By the close of trading, most of the morning's gains were lost. Bonds continued to rally as yields on 10-year Treasuries lost 6.5 basis points to settle at 4.27%. Crude oil prices advanced for the second straight day, climbing 1.7% to $77.70 per barrel. The dollar and gold prices advanced.
Wall Street posted solid gains last Thursday to close out a strong November. Among the benchmark indexes listed here, only the Nasdaq ended the session in the red, down 0.2%. The remaining indexes added value, led by the Dow (1.5%), followed by the S&P 500 and the Global Dow (0.4%), while the Russell 2000 edged up 0.3%. Bond prices, which had been surging, slid lower, driving yields higher. Ten-year Treasury yields closed at 4.35% after adding 8.1 basis points. Crude oil prices fell 2.8% to $75.67 per barrel despite an announced cut in production by OPEC+. The dollar gained 0.7%, while gold prices fell 0.5%.
Stocks closed last Friday on an upswing, closing higher for the fifth straight week. The Russell 2000 enjoyed the best returns after gaining 2.8%, followed by the large caps of the Dow, which added 0.8%, the Global Dow rose 0.7%, while the Nasdaq and the S&P 500 gained 0.6%. Bond prices surged with yields on 10-year Treasuries falling 12.6 basis points to 4.22%. Crude oil prices declined 2.3%, the dollar fell 0.3%, while gold prices rose 1.6%.
Market/Index | 2022 Close | Prior Week | As of 12/1 | Weekly Change | YTD Change |
DJIA | 33,147.25 | 35,390.15 | 36,245.50 | 2.42% | 9.35% |
Nasdaq | 10,466.48 | 14,250.85 | 14,305.03 | 0.38% | 36.67% |
S&P 500 | 3,839.50 | 4,559.34 | 4,594.63 | 0.77% | 19.67% |
Russell 2000 | 1,761.25 | 1,807.50 | 1,862.64 | 3.05% | 5.76% |
Global Dow | 3,702.71 | 4,144.28 | 4,195.74 | 1.24% | 13.32% |
Fed. Funds target rate | 4.25%-4.50% | 5.25%-5.50% | 5.25%-5.50% | 0 bps | 100 bps |
10-year Treasuries | 3.87% | 4.47% | 4.22% | -25 bps | 35 bps |
US Dollar-DXY | 103.48 | 103.40 | 103.22 | -0.17% | -0.25% |
Crude Oil-CL=F | $80.41 | $75.54 | $74.31 | -1.63% | -7.59% |
Gold-GC=F | $1,829.70 | $2,003.00 | $2,090.80 | 4.38% | 14.27% |
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week's Economic News
- The economy accelerated at an annualized rate of 5.2% in the third quarter, according to the second estimate of gross domestic product. GDP rose 2.1% in the second quarter. The increase in GDP reflected increases in consumer spending, private inventory investment, exports, state and local government spending, federal government spending, residential fixed investment, and nonresidential fixed investment. Imports, which are a negative in the calculation of GDP, increased. The personal consumption expenditures price index increased 2.8%. Excluding food and energy prices, the PCE price index increased 2.3%. Personal consumption expenditures, a major component in the calculation of GDP, rose 3.6% in the third quarter, compared to a 0.8% increase in the second quarter.
- The personal consumption expenditures price index, the Federal Reserve's preferred measure of inflation, increased less than 0.1% in October. Excluding food and energy, the PCE price index rose 0.2%. For the 12 months ended in October, the PCE price index rose 3.0%, 0.4 percentage point lower than the 12-month period ended in September. The PCE price index excluding, food and energy, increased 3.5% since October 2022, down from 3.7% for the 12 months ended in September. Personal income increased 0.2% in October. Disposable (after-tax) personal income increased 0.3%. Personal consumption expenditures, a measure of consumer spending, increased 0.2% in October.
- Sales of new single-family homes fell by 5.6% in October but were 17.7% above the October 2022 estimate. The median sales price of new houses sold in October 2023 was $409,300. The average sales price was $487,000. Inventory of new single-family homes for sale was at a 7.8-month supply at the current sales pace.
- A decline in new orders dragged manufacturing lower in November, according to the latest S&P Global US Manufacturing PMI®. Purchasing managers noted that a drop in new sales led to a slower expansion in production, which led to a reduction in the labor force. The S&P US Manufacturing Purchasing Managers' Index™ registered 49.4 in November, down from 50.0 in October. A reading of less than 50.0 indicates contraction in manufacturing.
- The advance report on international trade in goods showed a trade deficit of $89.8 billion in October, an increase of 3.4% over the September deficit. Exports of goods for October were $170.8 billion, a decrease of 1.7% from the previous month. Imports of goods for October were $260.7 billion, virtually unchanged from the September estimate.
- The national average retail price for regular gasoline was $3.238 per gallon on November 27, $0.051 per gallon lower than the prior week's price and $0.296 less than a year ago. Also, as of November 27, the East Coast price decreased $0.011 to $3.155 per gallon; the Midwest price fell $0.093 to $3.031 per gallon; the Gulf Coast price declined $0.076 to $2.710 per gallon; the Rocky Mountain price dropped $0.091 to $3.106 per gallon; and the West Coast price decreased $0.054 to $4.363 per gallon.
- For the week ended November 25, there were 218,000 new claims for unemployment insurance, an increase of 7,000 from the previous week's level, which was revised up by 2,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended November 18 was 1.3%, an increase of 0.1 percentage point from the previous week's rate. The advance number of those receiving unemployment insurance benefits during the week ended November 18 was 1,927,000, an increase of 86,000 from the previous week's level, which was revised up by 1,000. This is the highest level for insured unemployment since November 27, 2021, when it was 1,964,000. States and territories with the highest insured unemployment rates for the week ended November 11 were New Jersey (2.2%), California (2.1%), Alaska (2.0%), Hawaii (1.9%), Puerto Rico (1.7%), Washington (1.7%), Massachusetts (1.6%), New York (1.6%), Oregon (1.6%), and Rhode Island (1.6%). The largest increases in initial claims for unemployment insurance for the week ended November 18 were in California (+7,351), Oregon (+3,461), Kentucky (+1,925), Illinois (+1,359), and Iowa (+1,182), while the largest decreases were in Texas (-896), New York (-616), North Carolina (-537), Utah (-487), and Indiana (-447).
Eye on the Week Ahead
Economic data released during the first full week of December focuses on employment. The latest Job Openings and Labor Turnover Survey is for October. The previous report estimated 9.6 million job openings available in September, relatively unchanged from the prior month's total. This week, focus will also be aimed at the latest employment situation report for November. Employment has showed signs of slowing, with an estimate of 150,000 new jobs added in October, well below the downwardly revised September total of 297,000.
The Markets (as of market close November 24, 2023)
Market activity was subdued during Thanksgiving week, which saw stocks close higher. Each of the benchmark indexes listed here gained ground, led by the large caps of the Dow and the S&P 500. Each of the 11 market sectors ended the week higher, with health care, energy, and communication services leading the way. Treasury yields rose marginally higher, while crude oil prices slipped for the fifth straight week. The dollar declined, while gold prices advanced for the second consecutive week.
Thanksgiving week for Wall Street got off to a rousing start. Investors dove into the market last Monday, driving each of the benchmark indexes listed here higher. The Nasdaq gained 1.1%, the S&P 500 rose 0.7%, the Dow and the Global Dow added 0.6%, and the Russell 2000 climbed 0.5%. Communications and information technology were sectors driven higher by rising mega-cap tech companies. Ten-year Treasury yields moved very little, settling at 4.42%. Crude oil prices rose 2.1% to $77.50 per barrel. The dollar and gold prices dipped 0.4% and 0.3%, respectively.
A solid run for stocks ended last Tuesday as minutes from the last Federal Reserve meeting reminded investors that officials were willing to raise interest rates if economic data warranted it. Each of the benchmark indexes listed here lost value, with the Russell 2000 falling the furthest after dropping 1.3%. The Nasdaq declined 0.6%, while the Dow, the Global Dow, and the S&P 500 dipped about 0.1%. Ten-year Treasury yields slid to 4.41%. Crude oil prices changed little, closing at about $77.81 per barrel. The dollar ticked higher, while gold prices slipped minimally.
Stocks rebounded the day before Thanksgiving as markets were relatively quiet on one of the busiest travel days in the United States. The Russell 2000 recouped some ot its losses from the prior session, gaining 0.7%. The Dow and the Nasdaq added 0.5%, the S&P 500 rose 0.4%, and the Global Dow ticked up less than 0.1%. Ten-year Treasury yields remained at 4.41%, while crude oil prices ended a mini rally, falling 1.34% to $76.73 per barrel. The dollar climbed 0.3%, while gold prices fell 0.5%.
The New York Stock Exchange closed last Thursday for Thanksgiving and shut down early on Friday. Investors may have been more interested in the start of the seasonal shopping season last Friday, as they paid little attention to the market. The Nasdaq ticked down 0.1%, while the remaining benchmark indexes listed here posted gains, led by the Russell 2000 (0.7%), followed by the Dow and the Global Dow (0.3%), while the S&P 500 edged up 0.1%. Yields on 10-year Treasuries climbed 5.3 basis points to 4.46%. The dollar slid 0.4%, while gold prices climbed 0.5%. Crude oil prices fell 2.0%
Market/Index | 2022 Close | Prior Week | As of 11/24 | Weekly Change | YTD Change |
DJIA | 33,147.25 | 34,947.28 | 35,390.15 | 1.27% | 6.77% |
Nasdaq | 10,466.48 | 14,125.48 | 14,250.85 | 0.89% | 36.16% |
S&P 500 | 3,839.50 | 4,514.02 | 4,559.34 | 1.00% | 18.75% |
Russell 2000 | 1,761.25 | 1,797.77 | 1,807.50 | 0.54% | 2.63% |
Global Dow | 3,702.71 | 4,110.70 | 4,144.28 | 0.82% | 11.93% |
Fed. Funds target rate | 4.25%-4.50% | 5.25%-5.50% | 5.25%-5.50% | 0 bps | 100 bps |
10-year Treasuries | 3.87% | 4.44% | 4.47% | 3 bps | 60 bps |
US Dollar-DXY | 103.48 | 103.87 | 103.40 | -0.45% | -0.08% |
Crude Oil-CL=F | $80.41 | $75.78 | $75.54 | -0.32% | -6.06% |
Gold-GC=F | $1,829.70 | $1,982.80 | $2,003.00 | 1.02% | 9.47% |
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week's Economic News
- Sales of existing homes fell 4.1% in October and 14.6% since October 2022. Existing home sales have declined for five consecutive months. Inventory of available homes for sale ticked up to a 3.6-month supply in October, marginally higher than the 3.4-month supply in September. The median price for existing homes in October was $391,800, down from $392,800 in September, but 3.4% above the October 2022 price of $378,800. According to the National Association of Realtors®, a persistent lack of inventory and the highest mortgage rates in a generation have contributed to the decrease in home sales. However, while the existing home market remained tight, home sellers have seen prices continue to rise year-over-year, including a new all-time high for the month of October. Single-family home sales declined 4.2% last month and 14.6% from the previous year. The median existing single-family home price was $396,100 in October, down from September's price of $397,400, but up 3.0% from the October 2022 price of $384,600.
- New orders for manufactured durable goods, down three of the last four months, decreased 5.4% in October. Transportation equipment, also down three of the last four months, drove the decrease, falling 14.8%. Excluding transportation, new orders were virtually unchanged. Shipments of manufactured durable goods, down three of the last four months, decreased 0.9% in October. New orders for nondefense capital goods decreased 15.6% in October. New orders for defense capital goods increased 24.5% in October.
- The national average retail price for regular gasoline was $3.289 per gallon on November 20, $0.060 per gallon lower than the prior week's price and $0.359 less than a year ago. Also, as of November 20, the East Coast price decreased $0.046 to $3.166 per gallon; the Midwest price fell $0.061 to $3.124 per gallon; the Gulf Coast price declined $0.023 to $2.786 per gallon; the Rocky Mountain price dropped $0.141 to $3.197 per gallon; and the West Coast price decreased $0.103 to $4.417 per gallon. According to the U.S. Energy Information Administration, after adjusting for inflation, retail gasoline prices this Thanksgiving weekend are 13.0% lower than last year. Lower-than-usual gasoline demand this fall combined with the seasonal switch to winter-grade gasoline, which allows refiners to use less expensive components to produce gasoline, have helped reduce gasoline prices by $0.55/gal over the last two months. Recent declines in crude oil prices and low refining margins for producing gasoline suggest gasoline prices could remain relatively low through the end of the year.
- For the week ended November 18, there were 209,000 new claims for unemployment insurance, a decrease of 24,000 from the previous week's level, which was revised up by 2,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended November 11 was 1.2%, unchanged from the previous week's rate, which was revised down by 0.1%. The advance number of those receiving unemployment insurance benefits during the week ended November 11 was 1,840,000, a decrease of 22,000 from the previous week's level, which was revised down by 3,000. States and territories with the highest insured unemployment rates for the week ended November 4 were California (2.0%), New Jersey (2.0%), Puerto Rico (1.9%), Alaska (1.8%), Hawaii (1.8%), New York (1.6%), Massachusetts (1.5%), Oregon (1.5%), Rhode Island (1.5%), and Washington (1.5%). The largest increases in initial claims for unemployment insurance for the week ended November 11 were in Massachusetts (+3,019), New York (+2,574), Texas (+1,347), New Jersey (+1,058), and Minnesota (+1,014), while the largest decreases were in Oregon (-1,363), Georgia (-1,018), Pennsylvania (-716), Illinois (-685), and Iowa (-497).
Eye on the Week Ahead
The last week of November brings with it the release of some important economic data: the latest report on gross domestic product and the report on personal income and outlays. GDP advanced 4.9% in the third quarter, according to the initial estimate, well above the second quarter advance of 2.1%. The report on personal income and outlays includes the personal consumption expenditures price index, the preferred inflation indicator of the Federal Reserve. Prices advanced 3.4% for the year ended in September, while core prices rose 3.7%.